We often get asked whether a tech company can increase its chances of capital raising success through media exposure and a high profile, and even whether this can help to increase a company’s valuation?

We believe that the answer to both is yes, based on our own experience and some research. However, to be effective in fund raising, a company’s media profile should be built as an ongoing, long-term activity of the company, and not simply cooked for a capital raising campaign.

According to the recent Wharton study “Social is the New Financial: How Startup Media Activity Influences Funding Outcomes”, active social media presence increases the likelihood that a startup will close the round, the amount raised, and the breadth of the investor pool.

“In addition, startup social media activity is associated with more investment from investors with less information channels (e.g., angels) and making less industry specialized investments in particular, consistent with the hypothesis that social media improves an investor’s ability to discover potential investments. Also, the effect size of social media is stronger for startups where quality information is less available, such as firms outside geographic venture capital clusters or where later investors do not have network relationships with early investors”, according to the study.

We think that there are three basic principles to be employed in building your company media profile (similar to building a brand):

Build a community: You have the chance to connect with practically anyone on the planet through social media, so define your target investor community and customer sectors. Don’t just sell to your audience engage them. The sales and the investor interest will come naturally. In the world of today, people want real. You need to go out of your way to form real connections.

Thought leadership: Establish yourself as a thought-leader by producing content yourself. According to Joy Schoffler, Founder of Austin-based Leverage PR, “Positioning yourself as an expert contributor is the No. 1 technique start-ups in development looking to raise capital should use,” explains Schoffler. Particularly at the early stage, investors are buying into you and your vision. Positive press that positions you as an expert is outside validation that you know your stuff. And instead of talking about your company and your product exclusively, offer facts and metrics that support your claim–then tie in your company as further evidence of your claim.

Persistence: In the age of social media, having a continuous presence in your chosen marketplace and in the mindshare of your community is more important than ever before. It’s a more modern approach to developing a brand and engaging with customers than the traditional cyclical campaigns of limited duration. It also has the advantage of not giving the impression to investors that you are only communicating with them when you want their money.

A company valuation is indisputably linked to its intangible brand value, which is partly a function of its profile. One can do all the NPV and Revenue Multipliers calculations, but ultimately there is certain subjectivity in what valuation an investor is prepared to accept, based on their perception of the “brand”.

A couple of words of warning before you go gung-ho on building your media profile:

– Don’t start with your outreach until you are ready with a website, business plan and various collateral – shining on a spotlight on something half-baked can have a negative effect;

– Being overactive on social media can actually hurt your profile. The Wharton study found that more than 580 Tweets per annum becomes counter-productive.

Whatever the stage of their business, technopreneurs should be building their company media profile on an ongoing basis for a community of both investors and customers/prospects, to be ready for capital-raising campaigns.